Sch. Town of Windfall City v. Somerville, No. 22,055.

• Docket Nº: No. 22,055.
• Citation: 181 Ind. 463, 104 N.E. 859
• Case Date: April 07, 1914
• Court: Supreme Court of Indiana

181 Ind. 463
104 N.E. 859

SCHOOL TOWN OF WINDFALL CITY et al.
v.
SOMERVILLE et al.

No. 22,055.

Supreme Court of Indiana.

April 7, 1914.

Appeal from Circuit Court, Tipton County; Le Roy B. Nash, Judge.

Action by Peter C. Somerville and others against the School Town of Windfall City and Wildcat School Township of Tipton County. From a judgment for plaintiffs, defendants appeal. Affirmed.

[104 N.E. 860]

W. O. Dean, of Windfall, and J. R. Coleman, of Tipton, for appellants. Finley P. Mount, of Indianapolis, for appellees.

COX, J.

In 1895 appellants jointly owned, and since have, a lot abutting on a public street in the civil town of Windfall City, which they have at all times used jointly for public school purposes. In 1896 the board of trustees of the civil town proceeded under the law, familiarly known as the “Barrett Law” (Acts 1889, p. 237), to improve the abutting street with a brick paved roadway. This proceeding followed, regularly in all respects, the provisions of the statute and resulted in the completion of the improvement, and the assessment of the cost of it against the abutting property. A part of the cost was assessed against the school lot of appellants, and they, with others, executed the waiver, provided by the law, of all objections to the illegality or irregularity of their assessment and agreement to pay the same, with interest, in 10 annual installments. Thereupon, in 1897, bonds were issued to cover the amount of such assessments an interest, maturing one each year after date for 10 years. The last two of these bonds came into the possession of appellees, and they in this action sued appellants to recover thereon, praying for a judgment for the amount of unpaid installments assessed against the school lot and interest, for foreclosure of a lien against the lot for the amount, and for an order requiring appellants to pay the judgment within 30 days, failing to do which that the property should be sold by the sheriff as other property is sold on execution. A personal judgment only was rendered for the sum of $842.15, and therefrom this appeal is prosecuted.

The appeal is based on the claim that school property was not subject to assessment for local improvements at the time of the proceeding involved in this case, and that there was no valid law authorizing the judgment rendered. The Constitution provides: “The General Assembly shall provide, by law, for a uniform and equal rate of assessment and taxation; and shall prescribe such regulations as shall secure a just valuation for taxation of all property, both real and personal, excepting such only, for municipal, educational, literary, scientific, religious, or charitable purposes, as may be especially exempted by law.” Const. art. 10, § 1; section 193, Burns' Ann. St. 1908. Pursuant to the authority granted in this provision the General Assembly, by a provision in the general tax law of 1891, exempted from taxation school property, together with other property within the class mentioned in section 1, art. 10, supra; section 10144, Burns' Ann. St. 1908.

[1] But the rule is general and well established that a local assessment against real property, based on benefits which accrue to it from the improvement for which the assessment is made, is not a tax within the meaning of such provisions, and that they do not serve to exempt property from such assessments. 2 Cooley on Taxation (3d Ed.) pp. 362, 1228; 1 Paige & Jones on Taxation by Assessment, § 42; Welty on Assessments, §§ 169, 170; Hamilton on Special Assessments, § 282, note 13; 2 Elliott on Roads and Streets (3d Ed.) § 670; Palmer v. Stumph (1868) 29 Ind. 329;Reinken v. Fuehring (1892) 130 Ind. 382, 30 N. E. 414, 15 L. R. A. 624, 30 Am. St. Rep. 247;Rausch v. Trustees (1886) 107 Ind. 1, 8 N. E. 25.

The law under which the improvement here involved was made provided for the assessment of the cost against the abutting property in proportion to the amount of benefit which the improvement brought to the property. The terms of the statute applied to all real property, no matter what the character of its use or ownership, except that it was provided that property of the state should not be assessed without the written consent and approval of the treasurer and auditor of state. Acts 1889, p. 237; section 4288, Burns 1901. As exemptions from such burdens are not usually favored, they are seldom implied, and it would seem that the words of the statute are broad and comprehensive enough to authorize the assessment of the property of school corporations and other municipal subdivisions of the state, and to invest their officers with authority to waive irregularities and agree to pay in installments as therein provided, in common with those holding title to other property affected by the improvement, even though a wise and settled public policy, which has been declared in the Constitution and statutes providing for the establishment

[104 N.E. 861]

and perpetual maintenance of a system of public schools, might forbid the sale of the property on execution, or order to satisfy a lien, as other means are open to the payment of such assessments without resorting to such sale. The provisions for a special school tax and its uses appear to be ample to cover the cost of such an improvement as a benefit to the school property.

But the necessity of deciding whether the Barrett Law should be so construed does not lie before us. The identical question has been before the Appellate Court, and it reached a conclusion contrary to the view suggested above. Sutton v. School City of Montpelier (1902) 28 Ind. App. 315, 62 N. E. 710. In that case it was held that, in the absence of express authorization by the law, the civil town could not impose an assessment for a street improvement on abutting school property, and the officers of the school town could not waive irregularities and agree to pay the assessment. The opinion of the court in the case gives scant consideration to the questions involved and decided in proportion to their importance. No petition to transfer was filed, and therefore the case never received the consideration of this court. A declaration of the same rule was made by way of a dictum in the opinion, on petition for rehearing, of Jordan, J., in Town of Windfall City v. First National Bank of New Castle (1909) 172 Ind. 679, 694, 87 N. E. 984, 89 N. E. 311.

[2] Following the decision of the Appellate Court in Sutton v. School City, supra, the General Assembly passed an act obviously intended expressly to bring school property within the general provisions of the Barrett Law. This act, omitting the enacting clause, reads as follows:

“Section 1. That all common school corporations of this state shall hereafter possess the same powers and be subject to the same duties and liabilities in respect to municipal assessments for the cost of public improvements affecting their real estate that private owners of real estate possess or are subject to, and that the real estate of such corporations shall be subject to liens for such municipal assessments for public improvements in all cases where the same property would be so subject had it, at the time the lien attaches, been owned by a private owner, except that no penalty or attorney's fee in respect of any such municipal assessment shall be collectible from any such school corporation.

“Sec. 2. Whenever any such public improvement has been heretofore made and it has been paid for by a common school corporation out of its special school revenue, the act of the corporation in making the payment is hereby validated, and in every case where such an improvement has heretofore been made, but the cost has not yet been paid, where, if the real estate had been at the time in private ownership, a valid municipal assessment lien would have existed for the cost thereof and such a lien has been sought to be taken, which lien would, as against a private owner, be valid, the same as against such common school property, is hereby validated and made as enforceable as it would be had the property been, at the time the lien was sought to be taken, in private ownership, but no penalty or attorney's fee shall be collectible; and it is hereby made the duty of every such common school corporation to pay and discharge such lien out of the special school...